Wednesday, March 12, 2014

Why he is doing stuff like this in an election year is beside me - the hole continues to get deeper: Obama Will Seek Broad Expansion of Overtime Pay

President
Obama this week will seek to force American businesses to pay more overtime
to millions of workers, the latest move by his administration to confront
corporations that have had soaring profits even as wages have stagnated.

On Thursday, the president will direct the
Labor Department to revamp its regulations to require overtime pay for several
million additional fast-food managers, loan officers, computer technicians and
others whom many businesses currently classify as “executive or professional”
employees to avoid paying them overtime, according to White House officials
briefed on the announcement.

Mr. Obama’s decision to use his executive
authority to change the nation’s overtime rules is likely to be seen as a
challenge to Republicans in Congress, who have already blocked most of the
president’s economic agenda and have said they intend to fight his proposal to
raise the federal minimum wage to $10.10 per hour from $7.25.

Mr. Obama’s action is certain to anger the
business lobby in Washington, which has long fought for maximum flexibility for companies in paying overtime.

In 2004, business groups persuaded President
George W. Bush’s administration to allow them greater latitude on exempting
salaried white-collar workers from overtime pay, even as organized labor
objected.

Conservatives criticized Mr. Obama’s impending
action. “There’s no such thing as a free lunch,” said Daniel Mitchell, a senior
fellow with the Cato Institute, who warned that employers might cut pay or use
fewer workers. “If they push through something to make a certain class of
workers more expensive, something will happen to adjust.”

Marc Freedman, the executive director of labor
law policy for the U.S. Chamber of Commerce, said the nation’s overtime
regulations “affect a very wide cross section of employers and our members.”

“I expect this is an area we will be very much engaged in,” Mr. Freedman said.

Mr. Obama’s authority to act comes from his
ability as president to revise the rules that carry out the Fair Labor Standards
Act, which Congress originally passed in 1938. Mr. Bush and previous presidents
used similar tactics at times to work around opponents in Congress.

The proposed new regulations would increase
the number of people who qualify for overtime and continue Mr. Obama’s fight
against what he says is a crisis of economic inequality in the country. Changes
to the regulations will be subject to public comment before final approval by
the Labor Department, and it is possible that strong opposition could cause Mr.
Obama to scale back his proposal.

The overtime action by Mr. Obama is part of a broader election-year effort by
the White House to try to convince voters that Democrats are looking out for the
middle class. White House officials hope the focus on lifting workers’ pay will
translate into support for Democratic congressional candidates this fall.

Under current federal regulations, workers who
are deemed executive, administrative or professional employees can be denied
overtime pay under a so-called white-collar exemption.

Under the new rules that Mr. Obama is seeking,
fewer salaried employees could be blocked from receiving overtime, a move that
would potentially shift billions of dollars’ worth of corporate income into the
pockets of workers. Currently, employers are prohibited from denying
time-and-a-half overtime pay to any salaried worker who makes less than $455 per
week. Mr. Obama’s directive would significantly increase that salary level.

In addition, Mr. Obama will try to change
rules that allow employers to define which workers are exempt from receiving
overtime based on the kind of work they perform. Under current rules, if an
employer declares that an employee’s primary responsibility is executive, such
as overseeing a cleanup crew, then that worker can be exempted from overtime.